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The Priceline Group’s customers made more than 100 million reservations on smartphones over the last 12 months but CEO Darren Huston isn’t necessarily buying into a mobile-only or mobile-first strategy.
“Obviously there is a lot of talk, if you get somebody on a mobile app that in theory is the panacea because then their entry point to the Internet is always through you,” Huston said during a first quarter earnings conference call yesterday.
Huston said “a large chunk” of the company’s business is mobile Web — not apps — and he’s satisfied with the performance of its paid marketing through Google and other search engines to bring these customers onto the Priceline Group platform.
He sees a rhythm between TV advertising and online advertising, with clicks more likely because customers might have heard about the brand on TV. That enables Priceline to “lean in” and redouble its efforts in paid advertising, he said.
Let’s Go Fishing
“It’s like fishing,” Huston said. “Here we are going to fish and then you actually have no work with the customer to make them loyal over the long term. So that rhythm in our entire business is working very well.”
There will always be a balance between apps and mobile Web, Huston adds.
“We’re not a high-frequency thing like Facebook or Twitter. So our business is never going end up being 100 percent app and it’s always going to be a nice balance between Web and app.”
Parts of the business, namely OpenTable and Kayak, are heavier on the app side, Huston said, because travelers check their flight status frequently on Kayak apps and often make a habit of making restaurant reservations through OpenTable apps, Huston said.
Starting With Google or TripAdvisor
CFO Daniel Finnegan concurred that Priceline — and other travel businesses by implication — will never get all of their customers coming to their websites and apps directly.
“It’s likely that some business forever will come to us through paid channels,” Finnegan said. “So many people use Google as their entry point to the Internet. And metasearch with search players and TripAdvisor just having very strong brands so that some customers will always prefer to start there.”
Finnegan added, though ,that the company likes “the trends that we see in terms of people continuing to increasingly come to us directly.”
In the dog-eat-dog and disloyal world of customers chasing the lowest prices, though, the big challenge is to keep those customers coming back for more once you win them.